TODAY was supposed to be D-Day for Peter Kenyon’s latest bid to buy Newcastle.
The prospectus for potential investors in a £300million deal, sent out in June, gives an “anticipated closing date” of September 27.
Sources claim Kenyon and new partners GACP Sports have pulled together a total of about £80m from a number of interested parties — and are looking at raising the rest through bank loans.
Newcastle fans know better than to get excited about takeover talk after so many potential saviours have come and gone.
And the document feels like a bad omen for Kenyon’s new attempt to be more successful than his first — after owner Mike Ashley pulled the plug on initial talks in March.
But the glossy presentation at least gives a detailed insight into what ex-Chelsea chief executive Kenyon or someone else could do if they ever persuaded Ashley to get out of Toon.
It says: “In Newcastle United, GACP Sports sees the single greatest opportunity in English football to re-establish an iconic brand to become one of the leading clubs in the EPL.”
What does that mean? Well, the five-year plan is not a Manchester City or Chelsea-style transformation.
They do draw a comparison with Tottenham, though. In 2004, Forbes ranked Newcastle as the ninth-most valuable club in the world — a position now occupied by Spurs — after increasing their value five fold.
But following Tottenham into the Champions League, let alone into the final, is not on GACP’s short-term agenda for Newcastle.
On the pitch, they say they want to establish the club in the top ten of the Premier League and get back into European competition.
The financial projections are based on Newcastle finishing seventh in 2022-23 plus 2023-24 and qualifying for the Europa League.
That improvement would be achieved by significant, but not massive, transfer-market spending.
For the 2019-20 campaign, Kenyon and Co were pledging £75m for new players, with £35m the following season and £40m for each of the following campaigns.
That cash would come from increasing club income by up to £75m over the course of five years — with most of it derived from boosting commercial revenue from the current £22m per year to £61m.
The document predicts the new owners could more than triple the £5.5m-a-year shirt sponsorship with Fun 88 after it expires in 2020, to £18m. They also pledge to double the £6m-a-year kit deal with Puma, which is due to
run until 2022.
Key to their overall strategy is building bridges with the Newcastle fanbase alienated by Ashley’s ten-year reign. But everything comes down to money in the end.
The document even admits that: “Re-engagement and earning the trust of the fans will allow the club to build its match day and merchandising revenue.”
Also, the prospectus pushes Kenyon’s credentials as a football administrator and of GACP as owners. GACP Sports is a division of General American Capital Partners, one of three private equity funds run by Joseph DaGrosa.
The New York-born businessman is chairman of Bordeaux after last year’s takeover.
His lieutenants, David Neithardt and former footballer Hugo Varela, are also involved with the French Ligue 1 club and would be lined up for positions at Newcastle.
DaGrosa owns the global football conference group Soccerex.
He and Kenyon are promising great returns for investors as part of an ownership structure for Newcastle that would include companies in the Cayman Islands, Jersey and the US tax haven of Delaware.
But first they have to persuade Ashley to sell. In a recent interview, the Sports Direct chief said he is not going anywhere soon.
And even if the new Kenyon-led bid succeeded where others failed, Ashley and Sports Direct would be hanging around for a while.
The £300m offer comprises £125m to be paid immediately to Ashley for his shares in the club. But the £175m owed to him and his companies by Newcastle would be paid off over three years, with interest.
During that time: “Sports Direct (an affiliate of the seller) will receive an agreed upon signage package until the seller note is repaid.”
GACP also pledged to raise a further £50m to give the new Newcastle regime a kick-start. But nothing can begin until Ashley agrees to sell.
And now, another deadline will pass on the day Newcastle fans have dreamed of for so long.
Source: Read Full Article